Everywhere we can find news of people who give advice to operate with Bitcoin, Ethereum or other digital currencies. What before could seem like a futuristic scene, has now come to stay in the management of our personal finances. In fact, there are many changes that it has brought and that we will review below.
First of all, technology is an indispensable ally in our daily lives. In fact, it has been introduced in various aspects, from the ideal gift for Valentine’s Day to the way we perform professionally, being able to work remotely for companies around the world. How to explain all this?
The role of the Covid-19 pandemic
The arrival of the Coronavirus in 2020 altered everyone’s plans and that is nothing new. However, it cannot be denied that one of the most obvious consequences is the acceleration of digitization. Although this phenomenon has been observed since the beginning of the 21st century, the curve has accelerated exponentially.
According to various specialists and analysts, the year 2020 was considered the year of “the great digital leap”, but the arrival of the pandemic radicalized that change, making the internet connection as vital as the electricity or gas supply for millions. of people. Distance education, remote work, online transfers, medical consultations by video call. The list of changes could be endless.
In that sense, operating with cryptocurrencies is one of the great sequels that can be seen with the naked eye. While for many it was a fad or a financial bubble, these new assets have been strengthened by the arrival of Covid-19 and the need to operate without bureaucratic obstacles in an emergency context.
The cryptocurrency boom
Thus, we will find that from the year 2020 the use of digital currencies such as Bitcoin has become very popular, even more than the Zoom video call platform. According to various statistics, in just one year the use of cryptocurrencies multiplied by eight, which is difficult to find in other methods and financial instruments.
In addition to the pandemic, the historical performance that many of the digital currencies had in a context of economic recession such as 2020 should also be mentioned. Bitcoin, the first cryptocurrency in the world created in 2009 by an anonymous developer, occupied portals around the world. world by reaching all-time highs.
This had immediate consequences: companies like Paypal began to accept them on their platform, as did other industries such as tourism, online entertainment, real estate, the automotive sector and much more. In fact, some digital banks have also updated their proposal and today buying cryptocurrencies is as simple as sliding your index finger on the screen as if it were a match on Tinder.
This boom, moreover, can be found in densely populated countries. In India, for example, 18% of the population owns Bitcoin, which is a huge number considering that in 2019 that number was just 7%. This increase is even maintained despite the highly volatile nature of this type of asset.
Other cases of great increase in the use of cryptocurrencies are, of course, the United States, Germany or South Korea. Spain is not far behind, with 14% of people surveyed using cryptocurrencies against 10% just two years ago. China has also had an increase in this time, although the various restrictions of the government of that country work against it.
What are the advantages of trading cryptocurrencies?
In times of pandemic, many people realized the intrinsic advantages that the very nature of cryptocurrencies had. Being a decentralized financial asset, it does not depend on the authorization of any central body, nor of a government or authority. The operations are validated within the same network, giving greater security and speed to them.
Now that the pandemic has receded globally, many people have anyway adopted this method to invest, operate, save and even as a form of payment. In countries with problems of inflation and devaluation, such as the chaos of many Latin American nations, currencies such as Ethereum, Bitcoin and even stable coins have become a store of value.
Thus, given the inconvenience of obtaining dollars or other currencies, investors turned to cryptocurrencies in order to preserve the value of their assets, at the same time that in the case of volatile currencies it can be a strategy to earn money in a short term.
Another undoubted advantage is the ease of operating with them. While a few years ago the big problem with digital currencies was the knowledge needed to use them, in recent years the Fintech sector has designed tools such as digital wallets that allow anyone to buy and sell them.
As we have pointed out before, many digital banks added that service, as well as online payment platforms. As if the dollar or euro currency were chosen, now we can also have Bitcoin to make our movements.
What is to come?
Finally, it is inevitable to think about the future of this dynamic and changing sector. The truth is that you cannot do futurology with a sector that is constantly expanding and changing. For many, it is something similar to the emergence of the Internet in the 1990s at a massive level. Who could at that time imagine what was happening today?
However, there are some conclusions that can already be seen with the naked eye. For example, the entry of the youngest to the markets. According to various statistics, the age to operate is much lower than that of their parents when they began to be interested in the financial world. The technological facilities, of course, are what make the difference.
This phenomenon can be seen even outside cryptocurrencies: buying and selling shares on the Stock Exchange, trading Forex, entering the world of Binary Operations, Investment Funds and even banks that offer plans designed for their clients. Everything in one place: your mobile phone.
Finally, another immediate consequence is the exploitation of other sectors. The most obvious case is that of the tourism industry, which was one of the hardest hit by the pandemic. In their reactivation plans, they include proposals that seek to capture the holders of these assets. The case of El Salvador as a country that adopted Bitcoin as legal tender in the same status as the dollar could be the tip of a ball of yarn that we do not know where it will end.
If you are interested in entering this world, we recommend that you investigate the different options and what resources are available to you. Remember that in the financial world there are no magic formulas, so you will not become a millionaire overnight. After all, investing has nothing to do with the lottery.